KCPW insists city loan does not change its journalism

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A Salt Lake City Redevelopment Agency loan that bails out public radio station KPCW from potentially defaulting on one of its loans brings other questions including journalistic credibility in light of the station's finances and its relationship with the city.

After praising KCPW for its role in the community, the Salt Lake City Council, acting as the RDA Board, overruled its loan committee to unanimously approve a $250,000, six-month loan on Oct. 11 that will allow the National Public Radio affiliate to pay off a loan due Oct. 31. The station is in the midst of a funding drive that had reached half its goal when the RDA Board stepped in to cover the balance.

KCPW President Ed Sweeney said he expects that when the donor pledges are in, the total RDA loan will be for about $200,000.

The RDA's Loan Committee had unanimously advised the board to reject KCPW's loan request. The committee, made up of citizen appointees, was concerned, in part, that KCPW had not proven it could repay the principal on its debts, said RDA Executive Director D.J. Baxter.

It is unusual for the board to overrule the loan committee's advice, Baxter said. "More often than not, the RDA Board takes the loan committee's recommendation."

Councilman Carleton Christensen said the board felt that KCPW was important to the city's development and promotion efforts. But he acknowledged the RDA is taking a chance.

"It clearly is not going to be the most secure piece of debt we own. It is not without risk," Christensen said.

The loan is only the most recent financial relationship between KCPW and the city. The station already rents its offices in the Downtown Library ($1,200 per month for 3,000 square feet) and space for its satellite dish on Library Square ($1,000 per year).

In addition to the rent, the station provides the city "in trade" payment that Sweeney estimates at $60,000 annually through public information spots and library event broadcasts.

The RDA loan may have a similar in-trade provision that would cover the 5 percent interest payments, Sweeney and Christensen say. The RDA staff will work out the details of the deal with KCPW, Baxter confirmed.

Sweeney, who sees reporting on Salt Lake City and County to be the key mission of KCPW and is the station's highest-paid employee at $96,000 annually, acknowledged that the growing financial relationships with the city might bring questions from listeners about the credibility of KCPW's coverage of its benefactor and landlord.

"It's a fair question," Sweeney said. "We have a very stringent editorial fire wall. [The RDA loan] is not going to change anything."

KCPW news director Jeff Robinson, agreed. "We will go on covering the city as we have been. We'll make decisions [on news coverage] exactly as we did before."

Sweeney also recognizes that KCPW's listeners could be feeling donor fatigue as the station continues pressing for money to pay back the city loan, along with its regular drives for operating expenses and to refinance the remaining $1.8 million borrowed to acquire the station license in 2008.

"We are going to push it to the limit," Sweeney said. "We don't have a choice."

gwarchol@sltrib.com 

KCPW's fight for life

O If you want to delve more deeply into KCPW's money problems, the station lays it out in detail at www.kcpw.org.